Crispin Odey’s Odey Asset Management shed its entire stake in Sanchez Energy Corp (NYSE:SN), which amounted to 2.2 million shares. In addition, the hedge fund increased its exposure to Swift Transportation Co (NYSE:SWFT) by 490,400 shares. According to the 13G Form filed with the U.S. Securities and Exchange Commission, Mr. Odey’s firm now owns 1.9 million Class A Common Shares, representing 2.15% of the company’s outstanding stock.
Odey Asset Management is a London-based hedge fund that was founded in 1991. The firm is currently managed by founder Crispin Odey and has around $6.2 billion in assets under management. The company focuses on performance, thus laying greater value on generating returns than on gathering assets. Furthermore, it boasts a diversified equity portfolio, which is valued at around $2.8 billion as of the third quarter. According to its latest 13F disclosure, Odey Asset Management’s top picks for 2014 included Signet Jewelers Ltd. (NYSE:SIG), D.R. Horton, Inc (NYSE:DHI), and Delta Air Lines, Inc. (NYSE:DAL). These three equities accounted for almost 24% of the hedge fund’s equity portfolio.
Although the European hedge fund is having a very tough fiscal 2015, with returns dropping by more than 10% due to significant losses in October, the trend is slowly being reversed. As we reported a few days ago, Odey Asset Management profited heavily from its short position against The Swatch Group SA, which plummeted by around 20% since January 15.
The sale of all its holdings in Sanchez Energy Corp (NYSE:SN) was disclosed in a 13G Form filed on Tuesday, yet the transaction actually took place at the end of last year. Although several of the hedge fund’s positions suffered changes, this stock was the only one to be slashed all together. This was not an unreasonable move, considering the company is currently suffering the effects of the drop in crude oil prices. In fact, the oil producer recently announced it would be cutting its capital budget for 2015 by a whopping 60%. Hence, whereas Sanchez Energy intended to spend around $1.15 billion on drilling and new wells, the new budget stipulates expenditures of $600 million to $650 million.
Sanchez Energy Corp (NYSE:SN) is a $522 million unconventional oil and natural gas producer headquartered in Houston, Texas. The company’s main assets are located on the U.S. Gulf Coast, with its main focus set on its Eagle Ford Shale asset in South Texas. Odey Asset Management’s decision to sell its entire stake in this stock is certainly justified, considering shares lost around 63% of their value throughout 2014 and are not expected to bounce back anytime soon. Despite the grim outlook and poor performance last year, the company continues to enjoy the backing of numerous institutional investors. Steven Tananbaum’s Goldentree Asset Management for example disclosed holding 802,500 shares during the third quarter. On the other hand, Ken Griffin’s Citadel Investment Group reduced its stake in the company throughout that period by 77%, currently owning 353,000 shares of the stock.
In addition to dropping its position in Sanchez Energy, Odey Asset Management increased its stake in Swift Transportation Co (NYSE:SWFT). Several analysts consider this stock to be in a great position to achieve future earnings growth. Last year, the company experienced EPS growth of 23%, while estimates for 2015 are at around 29%. Hence, it comes as little surprise that the London-based hedge fund decided to increase its holdings in this stock.
Swift Transportation Co (NYSE:SWFT) is a $3.86 billion market cap multi-faceted transportation services company and truckload carrier. The Phoenix, Arizona based firm is viewed with optimism by several institutional investors, especially after its stock gained 28% in 2014. Apart from Odey Asset Management, Swift enjoys the backing of Clint Carlson’s Carlson Capital, which holds a position amounting to 2.35 million shares. Ken Griffin’s Citadel Investment Group is also bullish regarding the stock, with a position of 2.1 million shares, following a huge increase in its exposure during the third quarter.
Disclosure: Pablo Erbar holds no position in any stocks or funds mentioned.
